THIRD DIVISION

[G.R. No. 71479. October 18, 1990.]

MELLON BANK, N.A. , petitioner, vs. HON. CELSO L. MAGSINO, in his

capacity as Presiding Judge of Branch CLIX of the Regional Trial
Court at Pasig; MELCHOR JAVIER, JR., VICTORIA JAVIER; HEIRS OF
HONORIO POBLADOR, JR., namely: Elsa Alunan Poblador, Honorio
Poblador III, Rafael Poblador, Manuel Poblador, Ma. Regina
Poblador, Ma. Concepcion Poblador & Ma. Dolores Poblador; F.C.
HAGEDORN & CO., INC.; DOMINGO JHOCSON, JR.; JOSE MARQUEZ;
ROBERTO GARINO; ELNOR INVESTMENT CO., INC.; PARAMOUNT
FINANCE CORPORATION; RAFAEL CABALLERO; and TRI-ARC
INVESTMENT and MANAGEMENT CO., INC. , respondents.

Romulo, Mabanta, Buenaventura, Sayoc & De los Angeles for petitioner.

Jose Buendia for respondent Jose Marquez.
Raul L. Cornea & Associates for Jhocson and Garino.
Jesus I. Santos and Conrado Valera for Tri-Arc Investment, etc.
Bernardo D. Calderon for respondent ELNOR and Rafael Caballero.
Nazareno, Azada, Sabado & Dizon for Movants.
Balgos & Perez for Paramount Finance Corporation.
Meer, Meer & Meer for Hagedorn.
Alberto Villareza for F.C. Hagedorn & Co.

DECISION

FERNAN , C.J : p

The issue in the instant special civil action of certiorari is whether or not, by virtue
of the principle of election of remedies, an action led in California, U.S.A., to recover
real property located therein and to constitute a constructive trust on said property
precludes the ling in our jurisdiction of an action to recover the purchase price of said
real property.
On May 27, 1977, Dolores Ventosa requested the transfer of $1,000 from the
First National Bank of Moundsville, West Virginia, U.S.A. to Victoria Javier in Manila
through the Prudential Bank. Accordingly, the First National Bank requested the
petitioner, Mellon Bank, to effect the transfer. Unfortunately, the wire sent by Mellon
Bank to Manufacturers Hanover Bank, a correspondent of Prudential Bank, indicated
the amount transferred as "US $1,000,000.00" instead of US $1,000.00. Hence,
Manufacturers Hanover Bank transferred one million dollars less bank charges of $6.30
to the Prudential Bank for the account of Victoria Javier.
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 On June 3, 1977, Javier opened a new dollar account (No. 343) in the Prudential
Bank and deposited $999,943.70. Immediately thereafter, Victoria Javier and her
husband, Melchor Javier, Jr., made withdrawals from the account, deposited them in
several banks only to withdraw them later in an apparent plan to conceal, "launder" and
dissipate the erroneously sent amount.
On June 14, 1977, Javier withdrew $475,000 from account No. 343 and
converted it into eight cashier's checks made out to the following: (a) F.C. Hagedorn &
Co., Inc., two checks for the total amount of P1,000,000; (b) Elnor Investment Co., Inc.,
two checks for P1,000,000; (c) Paramount Finance Corporation, two checks for
P1,000,000; and (d) M. Javier, Jr., two checks for P496,000. The rst six checks were
delivered to Jose Marquez and Honorio Poblador, Jr. llcd

It appears that Melchor Javier, Jr. had requested Jose Marquez, a realtor, to look
for properties for sale in the United States. Marquez offered a 160-acre lot in the
Mojave desert in California City which was owned by Honorio Poblador, Jr. Javier,
without having seen the property, agreed to buy it for P3,236,800 (US $437,405)
although it was actually appraised at around $38,500. Consequently, as Poblador's
agent, Marquez executed in Makati a deed of absolute sale in favor of the Javiers and
had the document notarized in Manila before an associate of Poblador. Marquez
executed another deed of sale indicating receipt of the purchase price and sent the
deed to the Kern County Registrar in California for registration.
Inasmuch as Poblador had requested that the purchase price should not be paid
directly to him, the payment of P3,000,000 was coursed through Elnor Investment Co.,
Inc., allegedly Poblador's personal holding company; Paramount Finance, allegedly
headed by Poblador's brother, and F.C. Hagedorn, allegedly a stock brokerage with
extensive dealings with Poblador. The payment was made through the aforementioned
six cashier's checks while the balance of P236,000 was paid in cash by Javier who did
not even ask for a receipt.
The two checks totalling P1,000,000 was delivered by Poblador to F.C. Hagedorn
with speci c instructions to purchase Atlas, SMC and Philex shares. The four checks
for P2,000,000 with Elnor Investment and Paramount Finance as payees were delivered
to the latter to purchase "bearer" notes.
Meanwhile, in July, 1977, Mellon Bank led a complaint docketed as No. 148056
in the Superior Court of California, County of Kern, against Melchor Javier, Jane Doe
Javier, Honorio Poblador, Jr., and Does I through V. In its rst amended complaint to
impose constructive trust dated July 14, 1977, 1 Mellon Bank alleged that it had
mistakenly and inadvertently caused the transfer of the sum of $999,000.00 to Jane
Doe Javier; that it believes that the defendants had withdrawn said funds; that "the
defendants and each of them have used a portion of said funds to purchase real
property located in Kern County, California"; and that because of defendants'
knowledge of Mellon Bank's mistake and inadvertence and their use of the funds to
purchase the property, they and "each of them are involuntary or constructive trustees
of the real property and of any pro ts therefrom, with a duty to convey the same to
plaintiff forthwith." It prayed that the defendants and each of them be declared as
holders of the property in trust for the plaintiff; that defendants be compelled to
transfer legal title and possession of the property to the plaintiff; that defendants be
made to pay the costs of the suit, and that other reliefs be granted them.
On July 29, 1977, Mellon Bank also led in the Court of First Instance of Rizal,
Branch X, a complaint against the Javier spouses, Honorio Poblador, Jr., Domingo L.
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 Jhocson, Jr., Jose Marquez, Roberto Gariño, Elnor Investment Co., Inc., F.C. Hagedorn &
Co., Inc. and Paramount Finance Corporation. After its amendment, Rafael Caballero
and Tri-Arc Investment & Management Company, Inc. were also named defendants. 2
The amended and supplemental complaint alleged the facts set forth above and
added that Roberto Gariño, chief accountant of Prudential Bank, and who was the
reference of Mrs. Ventosa's dollar remittances to Victoria Javier, immediately informed
the Javiers of the receipt of US $1,000,000.00; that knowing the nancial
circumstances of Mrs. Ventosa and the fact that a mistake had been committed, the
Javiers, with undue haste, took unlawful advantage of the mistake, withdrew the whole
amount and transferred the same to a "343 dollar account"; that, aided and abetted by
Poblador and Domingo L. Jhocson, the Javiers "compounded and completed the
conversion" of the funds by withdrawing from the account dollars or pesos equivalent
to US $975,000; that by force of law, the Javiers had been constituted trustees of an
implied trust for the bene t of Mellon Bank with a clear duty to return to said bank the
moneys mistakenly paid to them; that, upon request of Mellon Bank and Manufacturers
Hanover Bank, Prudential Bank informed the Javiers of the erroneous transmittal of one
million dollars rst orally and later by letter-demand; that conferences between the
representatives of the Javiers, led by Jhocson and Poblador, in the latter's capacity as
legal and nancial counsel, and representatives of Mellon Bank, proved futile as the
Javiers claimed that most of the moneys had been irretrievably spent; that the Javiers
could only return the amount if the Mellon Bank should agree to make an absolute
quitclaim and waiver of future rights against them, and that in a scheme to conceal and
dissipate the funds, through the active participation of Jose Marquez, the Javiers
bought the California property of Poblador.
It further alleged that trust fund moneys totalling P3,000,000.00 were made
payable to Hagedorn, Paramount and Elnor; that Hagedorn, on instructions of Poblador,
purchased shares of stock at a stock exchange for P1,000,000.00 but later, it hastily
sold said shares at a loss of approximately P150,000.00 to the prejudice of the
plaintiff; that proceeds of the sale were deposited by Hagedorn in the name of
Poblador and/or the law o ce of Poblador, Nazareno, Azada, Tomacruz and Paredes;
that dividends declared on the shares were delivered by Hagedorn to Caballero after
the complaint had been led and thereafter, Caballero deposited the dividends in his
personal account; that after receiving the P1,000,000.00 trust money, Paramount
issued promissory notes upon maturity of which Paramount released the amount to
unknown persons; that Elnor also invested P1,000,000.00 in Paramount for which the
latter also issued promissory notes; that after the ling of the complaint, counsel for
plaintiff requested Paramount not to release the amount after maturity; that in evident
bad faith, Elnor transferred the non-negotiable Paramount promissory notes to Tri-Arc;
that when the notes matured, Paramount delivered the proceeds of P1,000,000.00 to
Tri-Arc; that Poblador knew or should have known that the attorney's fees he received
from the Javiers came from the trust funds; and that despite formal demands even
after the ling of the complaint, the defendants refused to return the trust funds which
they continued concealing and dissipating.
It prayed that: (a) the Javiers, Poblador, Elnor, Jhocson and Gariño be ordered to
account for and pay jointly and severally unto the plaintiff US$999,000.00 plus
increments, additions, fruits and interests earned by the funds from receipt thereof until
fully paid; (b) the other defendants be ordered to account for and pay unto the plaintiff
jointly and severally with the Javiers to the extent of the amounts which each of them
may have received directly or indirectly from the US$999,000.00 plus increments,
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 additions, fruits and interests; (c) Marquez be held jointly and severally liable with
Poblador for the amount received by the latter for the sale of the 160-acre lot in
California City; and (d) defendants be likewise held liable jointly and severally for
attorney's fees and litigation expenses plus exemplary damages.
In due course, the defendants led their answers and hearing of the case ensued.
In his testimony, Jose Marquez stated that Prudential Bank and Trust Company checks
Nos. 2530 and 2531 in the respective amounts of P100,000 and P900,000 payable to
F. C. Hagedorn were delivered to him by Melchor Javier, Jr. as partial consideration for
the sale of Poblador's property in California. After receiving the checks, Hagedorn
purchased shares of Atlas Mining, Philex, Marcopper and San Miguel Corporation for
Account No. 3000, which, according to Fred Hagedorn, belonged to the law o ce of
Poblador. 3
F.C. Hagedorn & Co., Inc. then sold the shares for P874,490.75 as evidenced by
HSBC check No. 339736 for P400,000 and HSBC check No. 339737 for P474,490.75
payable to "cash". Mellon Bank traced these checks to Account 2825-1 of the Philippine
Veterans Bank in the name of Cipriano Azada, Poblador's law partner and counsel to the
Javiers. 4 An employee of the Philippine Veterans Bank thereafter introduced the
specimen signature cards for Account No. 2825-1 thereby con rming Azada's
ownership of the account. Defendants objected to this testimony on the grounds of
Azada's absence, the con dentiality of the bank account, and the best evidence rule.
The court overruled the objection. Another employee of the Philippine Veterans Bank
then presented the ledger card for Account No. 2825-1, a check deposit slip and a daily
report of returned items. The defendants objected but they were again overruled by the
court. cdll

Mellon Bank then subpoenaed Erlinda Baylosis of the Philippine Veterans Bank to
show that Azada deposited HSBC checks No. 339736 and 339737 amounting to
P874,490.75 in his personal current account with said bank. It also subpoenaed
Pilologo Red, Jr. of Hongkong & Shanghai Banking Corporation to prove that said
amount was returned by Azada to Hagedorn.
The testimonies of these witnesses were objected to by the defense on the
grounds of res inter alios acta, immateriality, irrelevancy and con dentiality. To resolve
the matter, the court ordered the parties to submit memoranda. The defendants'
objections were also discussed at the hearing on July 13, 1982. For the rst time,
Poblador's counsel raised the matter of "election of remedies." 5
At the July 20, 1982 hearing, the lower court, then presided by Judge E cio
Acosta, conditionally allowed the testimonies of Baylosis and Red. Baylosis a rmed
that Azada deposited checks Nos. 339736 and 339737 in the total amount of
P874,490.75 in his personal account with the Philippine Veterans Bank but almost
simultaneously, Azada issued his PVB check for the same amount in favor of Hagedorn.
Consequently, Azada's check initially bounced. For his part, Red testi ed that Azada's
check for P874,490.75 was received by the Hongkong & Shanghai Banking Corporation
and credited to the account of Hagedorn.
The defendants then moved to strike off the testimonies of Baylosis and Red
from the record. Defendant Paramount Finance Corporation, which is not a party to the
California case, thereafter led its memorandum raising the matter of "election of
remedies". It averred that inasmuch as the Mellon Bank had led in California an action
to impose constructive trust on the California property and to recover the same, Mellon
Bank can no longer try to regain the purchase price of the same property through Civil
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 Case No. 26899. The other defendants adopted Paramount's stand.
After Mellon Bank led its reply to the memorandum of Paramount, on
September 10, 1982, Judge Acosta issued a resolution ordering that the testimonies of
Baylosis and Red and the documents they testi ed on, which were conditionally
allowed, be stricken from the records. 6 Judge Acosta explained:
"After a judicious evaluation of the arguments of the parties the Court is
of the view that in cases where money held in trust was diverted by the trustee,
under the `rule of trust pursuit' the bene ciary `may elect whether to accept the
trust estate in its new form or hold the trustee responsible for it in its original
condition' (Lathrop vs. Hampton, 31 Cal. 17; Zodos vs. Marefalos, 48 Idaho 291;
Bahle vs. Hasselbrach, 64 NW Eq. 334, 51 Sections 508-76 Am Jur. 2d p. 475),
and that `an election to pursue one remedy waives and bars pursuit of any
inconsistent remedy, (76 Am Jur. 2d S253). The instant complaint among
others is for the recovery of the purchase price of the Kern property as held in
trust for the plaintiff while in the California case the plaintiff maintains that the
Kern property is held in trust for the plaintiff, which positions are inconsistent
with each other. Neither can the plaintiff now abandon his complaint for the
recovery of the Kern property and pursue his complaint for the recovery of the
purchase price of said property for `if he has rst sought to follow the res, the
plaintiff cannot thereafter hold the trustee personally responsible' and `when
once there has been an election to do one of two things, you cannot retract it
and do the other thing. The election once made is nally made.' (Fowler vs.
Bowvery Savings Bank 113 N.Y. 450, 21 N.E. 172, 4 LRA 145, 10 Am. S.R. 479. 2
Silv. 280, 23, Abb. N. Cos. 133065 C. J. p. 980 Note 32).
"The fact that the California case has been stayed pending determination
of the instant case only means that should this case be dismissed, the
California case can proceed to its final determination.
"Furthermore, when the plaintiff led the California case for the transfer
of legal title and possession of the Kern property to the plaintiff it in effect
rati ed the transaction for 'by taking the proceeds or product of a wrongful
transfer of trust property or funds, the bene ciary rati es the transaction' (Board
of Commissioner vs. Strawn [CA6 Ohio] 157 F. 49, 76 Am Jur. 2d Section 253).
Consequently the purchase price of the California property received by
defendant Poblador from Javier is no longer the proper subject matter of
litigation and the movement and disposition of the purchase price is therefore
within the scope of the absolutely con dential nature of bank deposits as
provided by Sec. 2, R.A 1405 as amended by PD No. 1792."
Mellon Bank moved for reconsideration, alleging that said order prevented the
presentation of evidence on the purchase price of the California property; that the
California case cannot be considered a waiver of the pursuit of the purchase price as
even if said case was led fteen days prior to the ling of the original complaint in this
case, except for the Javiers, no other defendants raised in their answers the a rmative
defense of the ling of the California case; that after the amendment of the complaint,
none of the defendants raised the matter of "election of remedies" in their answers; that
realizing this procedural error, Paramount sought the amendment of its answer to
re ect the "defense" of election of remedies"; that, disregarding its previous orders
allowing evidence and testimonies on Account No. 2825-1, the court made a turnabout
and ruled that the testimonies on said account were irrelevant and con dential under
Republic Act No. 1405; that Philippine law and jurisprudence does not require the
election of remedies for they favor availment of all remedies; that even United States
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 jurisprudence frowns upon election of remedies if it will lead to an inequitable result;
that, as held by this Court in Radiowealth vs. Javier, 7 there can be no binding election of
remedies before the decision on the merits is had; that until Mellon Bank gets full
recovery of the trust moneys, any contention of election of remedy is premature, and
that, the purchase price being the subject of litigation, inquiring into its movement,
including its deposit in banks, is allowed under Republic Act No. 1405.
Defendants led their respective comments and oppositions to the motion for
reconsideration. In its reply, the Mellon Bank presented proof to the effect that in the
California case, defendants led motions to strike out the cross-complaint of Mellon
Bank, for summary judgment and to stay or dismiss the action on the ground of
inconvenient forum but the rst two motions and the motion to dismiss were denied
"without prejudice to renew upon determination of the Philippine action". The motion to
stay proceedings was "granted until determination of the Philippine action." 8
On October 28, 1983, the lower court, through Judge Acosta, denied the motion
for reconsideration and ordered the continuation of the hearing (Rollo, p. 182). The
plaintiff led a motion for the reconsideration of both the September 10, 1982 and
October 28, 1983 orders. After the parties had led comments, opposition and reply,
the court, through Judge Celso L. Magsino, denied Mellon Bank's second motion for
reconsideration on the ground that it was "proscribed by the 1983 Interim Rules of
Court" in an order dated July 9, 1985. 9
The court ruled that the determination of the relevancy of the testimonies of
Baylosis and Red was "premised directly and principally" on whether or not Mellon Bank
could still recover the purchase price of the California property notwithstanding the
ling of the case in California to recover title and possession of the said property. After
quoting the resolution of September 10, 1982, the Court ruled that it was a " nal order
or a de nitive judgment with respect to the claim of plaintiff for the recovery" of the
purchase price of the California property. It stated:
"The adjudication in the Order on September 10, 1982 and the Order of
October 28, 1983, which has the effect of declaring that plaintiff has no cause
of action against the defendants for the recovery of the proceeds of the sale of
Kern property in the amount of Three Million Three Hundred Fifty Thousand
Pesos P3,500,000.00 [sic]) for having led a complaint for the recovery of the
Kern property in the Superior Court of California, County of Kern, is a nal and
definitive disposition of the claim of the plaintiff to recover in the instant action
the proceeds of sale of said property against the defendants. The issue of
"election of remedy" by the plaintiff was lengthily and thoroughly discussed and
argued by the parties before the rendition of the resolution of September 10,
1982, and in the motion for reconsideration and oppositions thereto before its
resolution in the Order of October 28, 1983. Such issue is a substantive one as it
refers to the existence of plaintiff's cause of action to recover the proceeds of
the sale of the Kern property in this action, and that issue was presented to the
Court as if a motion to dismiss or a preliminary hearing of an a rmative
defense on the ground that plaintiff has no cause of action, and was resolved
against plaintiff in the Order of September 10, 1982, after a full hearing of all
the parties. Said Order of September 10, 1982 has the effect of putting an end to
the controversy between the parties as to the right of plaintiff to claim or recover
the proceeds of the sale of the Kern property from the defendants. It is therefore
an adjudication upon the merits. 1 0
Hence, Mellon Bank led the instant petition for certiorari claiming that the
resolution of September 10, 1982 and the orders of October 28, 1983 and July 9, 1985
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 are void for being unlawful and oppressive exercises of legal authority, subversive of
the fair administration of justice, and in excess of jurisdiction. The petition is founded
on its allegations that: (a) the resolution of September 10, 1982 is interlocutory as it
does not dispose of Civil Case No. 26899 completely: (b) the evidence stricken from
the records is relevant on the basis of the allegations of the amended and
supplemental complaint, and (c) the doctrine of election of remedies, which has long
been declared obsolete in the United States, is not applicable in this case.
With the exception of the Javiers, all the respondents led their respective
comments on the petition. Having failed to le said comment, the Javiers' counsel of
record, Azada, Tomacruz & Cacanindin, 11 was required to show cause why disciplinary
action should not be taken against it. And, having also failed to show cause, it was ned
P300.
In his motion for reconsideration of the resolution imposing said ne, Cipriano
Azada alleged that in Civil Case No. 26899, the Javiers were indeed represented by the
law rm of Poblador, Azada, Tomacruz & Cacanindin but he was never the lawyer of the
Javiers' in his personal capacity; that after the death of Honorio Poblador, Jr., he had
withdrawn from the partnership; that he is the counsel of the Administratrix of the
Estate of Honorio Poblador, Jr. for which he had led a comment, and that should the
Court still require him to le comment for the Javiers despite the lack of client-lawyer
relationship, he would adopt the comment he had filed for the said Administratrix. 1 2
In its effort to locate the Javiers so that their side could be heard, we required the
petitioner to furnish us with the Javiers' address as well as the name and address of
their counsel. 13 In compliance therewith, counsel for petitioner manifested that the
Javiers had two known addresses in San Juan, Metro Manila and in Sampaloc, Manila;
that since their conviction in Crim. Case No. CCC-VII-2369-P.C. of the Pasig Regional
Trial Court, the Javiers had gone into hiding and warrants for their arrest still remain
unserved; 1 5
Inasmuch as copies of the resolution requiring comment on the petition and the
petition itself addressed to Melchor Javier were returned with the notations "moved"
and "deceased", the Court required that said copies be sent to Mrs. Javier herself and
that petitioner should inform the Court of the veracity of Javier's death. 16 A copy of
the resolution addressed to Mrs. Javier was returned also with the notation "deceased."
17

Counsel for petitioner accordingly informed the Court that he learned that the
Javiers had ed the country and that he had no way of verifying whether Melchor Javier
had indeed died. 1 8
In view of these circumstances, the Javiers' comment on the petition shall be
dispensed with as the Court deems the pleadings led by the parties su cient bases
for resolving this case. The Javiers shall be served copies of this decision in
accordance with Section 6, Rule 13 of the Rules of Court by delivering said copies to the
clerk of court of the lower court, with proof of failure of both personal service and
service by mail.
We hold that the lower court gravely abused its discretion in ruling that the
resolution of September 10, 1982 is a " nal and de nitive disposition" of petitioner's
claim for the purchase price of the Kern property. The resolution is interlocutory and
means no more than what it states in its dispositive portion — the testimonies of
Baylosis and Red and the documents they testi ed on, should be stricken from the
record. llcd

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 That the resolution discusses the common-law principle of election of remedies,
a subject matter which shall be dealt with later, is beside the point. It is interlocutory
because the issue resolved therein is merely the admissibility of the plaintiff's evidence.
19 As such, it does not dispose of the case completely but leaves something more to
be done upon its merits. 2 1
Furthermore, the lower court's holding in its July 9, 1985 order that petitioner's
second motion for reconsideration is proscribed by the 1983 Interim Rules of Court
which disallows such motion on a nal order or judgment, should be recti ed. As
explained above, the resolution of September 10, 1982 is not a nal one. It also
contains conclusions on procedural matters which, if left unchecked, would prejudice
petitioner's substantive rights.
In effect, therefore, the July 9, 1985 order is a shortcut disposition of Civil Case
No. 26899 in total disregard of petitioner's right to a thorough ventilation of its claims.
By putting a premium on procedural technicalities over the resolution of the merits of
the case, the lower court rode roughshod over the basic judicial tenet that litigations
should, as much as possible, be decided on their merits and not on technicalities. 22
The trial court's patent grave abuse of discretion therefore forces us to exercise
supervisory authority to correct its errors notwithstanding the fact that ordinarily, this
Court would not entertain a petition for certiorari questioning the legality and validity of
an interlocutory order. 2 3
Respondents' principal objection to the testimonies of Baylosis and Red is their
alleged irrelevance to the issues raised in Civil Case No. 26899. The fallacy of this
objection comes to fore upon a scrutiny of the complaint. Petitioner's theory therein is
that after the Javiers had maliciously appropriated unto themselves $999,000, the
other private respondents conspired and participated in the concealment and
dissipation of said amount. The testimonies of Baylosis and Red are therefore needed
to establish the scheme to hide the erroneously sent amount.
Private respondents' protestations that to allow the questioned testimonies to
remain on record would be in violation of the provisions of Republic Act No. 1405 on
the secrecy of bank deposits, is unfounded. Section 2 of said law allows the disclosure
of bank deposits in cases where the money deposited is the subject matter of the
litigation. 24 Inasmuch as Civil Case No. 26899 is aimed at recovering the amount
converted by the Javiers for their own bene t, necessarily, an inquiry into the
whereabouts of the illegally acquired amount extends to whatever is concealed by
being held or recorded in the name of persons other than the one responsible for the
illegal acquisition. 2 5
We view respondents' reliance on the procedural principle of election of
remedies as part of their ploy to terminate Civil Case No. 26899 prematurely. With the
exception of the Javiers, respondents failed to raise it as a defense in their answers and
therefore, by virtue of Section 2, Rule 9 of the Rules of Court, such defense is deemed
waived. 26 Notwithstanding its lengthy and thorough discussion during the hearing and
in pleadings subsequent to the answers, the issue of election of remedies has not,
contrary to the lower court's assertion, been elevated to a "substantive one." Having
been waived as a defense, it cannot be treated as if it has been raised in a motion to
dismiss based on the nonexistence of a cause of action.
Moreover, granting that the defense was properly raised, it is inapplicable in this
case. In its broad sense, election of remedies refers to the choice by a party to an
action of one of two or more coexisting remedial rights, where several such rights arise
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 out of the same facts, but the term has been generally limited to a choice by a party
between inconsistent remedial rights, the assertion of one being necessarily repugnant
to, or a repudiation of, the other. In its technical and more restricted sense, election of
remedies is the adoption of one of two or more coexisting remedies, with the effect of
precluding a resort to the others. 2 7
As a technical rule of procedure, the purpose of the doctrine of election of
remedies is not to prevent recourse to any remedy, but to prevent double redress for a
single wrong. 28 It is regarded as an application of the law of estoppel, upon the theory
that a party cannot, in the assertion of his right occupy inconsistent positions which
form the basis of his respective remedies. However, when a certain state of facts under
the law entitles a party to alternative remedies, both founded upon the identical state of
facts, these remedies are not considered inconsistent remedies. In such case, the
invocation of one remedy is not an election which will bar the other, unless the suit upon
the remedy rst invoked shall reach the stage of nal adjudication or unless by the
invocation of the remedy rst sought to be enforced, the plaintiff shall have gained an
advantage thereby or caused detriment or change of situation to the other. 3 0
Consonant with these rulings, this Court, through Justice J.B.L. Reyes, opined that
while some American authorities hold that the mere initiation of proceedings
constitutes a binding choice of remedies that precludes pursuit of alternative courses,
the better rule is that no binding election occurs before a decision on the merits is had
or a detriment to the other party supervenes. 31 This is because the principle of
election of remedies is discordant with the modern procedural concepts embodied in
the Code of Civil Procedure which permits a party to seek inconsistent remedies in his
claim for relief without being required to elect between them at the pleading stage of
the litigation. 3 2
It should be noted that the remedies pursued in the California case and in Civil
Case No. 26899 are not exactly repugnant or inconsistent with each other. If ever, they
are merely alternative in view of the inclusion of parties in the latter case who are not
named defendants in the former. The causes of action, although they all stem from the
erroneous transmittal of dollars, are distinct as shown by the complaints lengthily set
out above. The bar of an election of remedies does not apply to the assertion of
distinct causes of action against different persons arising out of independent
transactions. 3 3
As correctly pointed out by the petitioner, the doctrine of election of remedies is
not favored in the United States for being harsh. 34 Its application with regard to two
cases led in two different jurisdictions is also circumscribed by jurisprudence on
abatement of suits. Thus, in Brooks Erection Co. v. William R. Montgomery &
Associates, Inc., 35 it is held:
"The pendency of an action in the courts of one state or country is not a
bar to the institution of another action between the same parties and for the
same cause of action in a court of another state or country, nor is it the duty of
the court in which the latter action is brought to stay the same pending a
determination of the earlier action, even though the court in which the earlier
action is brought has jurisdiction su cient to dispose of the entire controversy.
Nevertheless, sometimes stated as a matter of comity, not of right, it is usual for
the court in which the later action is brought to stay proceedings under such
circumstances until the earlier action is determined."
However, in view of the fact that the California court wherein the case for
recovery of the Kern property was first filed against the Javiers had stayed proceedings
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 therein until after the termination of Civil Case No. 26899, the court below can do no
less than expedite the disposition of said case.
We cannot dispose of this case without condemning in the strongest terms
possible the acts of chicanery so apparent from the records. The respective liabilities
of the respondents are still being determined by the court below. We must warn,
however, against the use of technicalities and obstructive tactics to delay a just
settlement of this case. The taking advantage of the petitioner's mistake to gain
sudden and undeserved wealth is marked by circumstances so brazen and shocking
that any further delay will re ect poorly on the kind of justice our courts dispense. The
possible involvement of lawyers in this sorry scheme stamps a black mark on the legal
profession. The Integrated Bar of the Philippines (IBP) must be made aware of the
ostensible participation, if not instigation, in the spiriting away of the missing funds.
The IBP must take the proper action at the appropriate time against all lawyers involved
in any misdeeds arising from this case.
WHEREFORE, the resolution of September 10, 1982 and the orders of October
28, 1982 and July 9, 1985 are hereby annulled. The lower court is ordered to proceed
with dispatch in the disposition of Civil case No. 26899, considering that thirteen (13)
years have gone by since the original erroneous remittance. LexLib

Service of this decision on the Javier spouses shall be in accordance with

Section 6, Rule 13 of the Rules of Court. A copy of this decision shall be served on the
Integrated Bar of the Philippines.
The decision is immediately executory. Costs against private respondents.
SO ORDERED.
Gutierrez, Jr., Feliciano, Bidin and Cortes, JJ., concur.
Footnotes
1. Rollo, p. 101.

2. Civil Case No. 26899.

3. Rollo, p. 73.
4. Rollo, pp. 73-74.
5. Rollo, p. 28.

6. Rollo, pp. 118-119.

7. 7 SCRA 804.
8. Rollo, p. 167.
9. Rollo, p. 251.
10. See Licup vs. Manila Railroad Co., 2 SCRA 267, 271. Emphasis supplied.

11. Rollo, p. 17.

12. Rollo, p. 459.
13. Rollo, p. 467.
14. See: People vs. Court of Appeals, No. 51635, December 14, 1982, 119 SCRA 162.
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 15. Rollo, p. 483.
16. Rollo, p. 601.
17. Rollo, p. 615.
18. Rollo, p. 607.
19. Lamagan vs. De la Cruz, L-27950, July 29, 1971, 40 SCRA 101, 106-107.

20. Marcelo vs. De Guzman, L-29077, June 29, 1982, 114 SCRA 657.
21. Rollo, p. 636; Civil Case No. 26899 is now with the Regional Trial Court of Pasig, Branch
159, presided by Judge Maria Alicia M. Austria.
22. De Lima vs. Laguna Tayabas Co., L-35697-99, April 15, 1988, 160 SCRA 70.
23. Savory Luncheonette vs. Lakas ng Manggagawang Pilipino, L-38964, January 31, 1975, 62
SCRA 258; Manila Electric Co. vs. Enriquez, 110 Phil. 499.
24. Philippine National Bank vs. Gancayco, L-18343, September 30, 1965, 15 SCRA 91.
25. See Banco Filipino Savings and Mortgage Bank vs. Purisima, No. 56429, May 28, 1988, 161
SCRA 576.
26. Royal Resources, Inc. vs. Gibraltar Financial Corp. 603 P. 2d 793.

27. People vs. Court of Appeals, No. 54641, November 28, 1980, 101 SCRA 450, 463-464 citing
Whitney v. Vermon [Tex. Civ. A] 154, 264, 267 and Southern R. Co. vs. Attalla, 147 Ala.
653, 41 S. 664.

28. Royal Resources, Inc. vs. Gibraltar Financial Corp., supra.

29. Giron v. Housing Authority of Opelousas, 393 So. 2d 1267.

30. Colonial Leasing Co. of New England, Inc. v. Tracy, 557 P. 2d 639, 276 Or. 1193; Johnson v.
Dave's Auto Center, 257 Or. 34, 476 P. 2d 190.

31. Radiowealth, Inc. vs. Lavin, L-18563, April 27, 1963, 7 SCRA 804.
32. Giron vs. Housing Authority of the City of Opelousas, supra.

33. American Savings and Loan Association of Houston v. Musick, 531 S.W. 2d 581 citing
Custom Leasing, Inc. vs. Texas Bank & Tr. Co. of Dallas, 491 S.W. 2d 869.
34. Newport News Shipbuilding and Dry Dock Co. vs. Director, O ce of Workers' Compensation
Program, U.S. Dept. of Labor, 583 F. 2d 1273, certiorari denied 99 S. Ct. 1232, 440 U.S.
915, 59 L. Ed. 2d 465; Strauss v. DiCicco, 408 N.Y.S. 2d 810, 64 A.D. 2d 979; McCrary v.
Taylor, 579 S.W. 2d 347.

35. 576 S.W. 2d 273.

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